Myths vs. Facts: The 401(k) Fair Disclosure for Retirement Security Act

by Press Staff Myth: H.R. 1984 will require too much disclosure and will confuse 401(k) participants.

Fact: H.R. 1984 would require clear and simple fee disclosure so that workers can make sound investment decisions for themselves. The biggest problem currently facing workers with 401(k) plans is that there is too little disclosure of fees, not too much. Plan participants should be presented with the facts and then be allowed to make their own decisions.

Myth: Fees on 401(k)s are already adequately disclosed.

Fact: There is no one place that 401(k) plan participants can go to find out about the fees they are paying. Information that is available is difficult to find and difficult to read. As a result, a 2007 survey by the AARP found that roughly 80 percent of plan participants were not aware how much in fees were taken out of their 401(k)s.